EADS CEO still confident of winning US tanker contract

DOGMERSFIELD, England - EADS CEO Louis Gallois said he is confident his company and US partner Northrop Grumman Corp. will win a disputed US$35 billion (Ð22.3 billion) Pentagon Air Force tanker contract when the bidding process reopens.

By (AP)

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Published: Sun 13 Jul 2008, 5:49 PM

Last updated: Sun 5 Apr 2015, 12:49 PM

The US Air Force in February selected the Northrop team to replace 179 Eisenhower-era aerial refueling planes. Boeing filed a protest in March, and last week US Defense Secretary Robert Gates said the Pentagon will reopen the bid.

‘We will get the tanker because we have the best airplane,’ Gallois, head of the European aerospace and defense giant, told reporters Saturday in the village of Dogmersfield, in southern England.

The deal _ one of the largest in Pentagon history _ is the first of three contracts worth up to US$100 billion to replace nearly 600 refueling tankers over the next 30 years.

The Air Force's original decision provoked fury among US politicians, who objected to the military deal being awarded to an overseas contractor. Boeing had supplied refueling tankers to the Air Force for nearly 50 years.

The decision also came as a surprise to some. John Young, chief operating officer for EADS North America, told reporters Saturday that even his mother was shocked.

‘But I wasn't,’ he said. ‘We have the best product and frankly that will stand the test of time.’

Following Boeing's complaint, the Government Accountability Office last month detailed ‘significant errors’ the Air Force made in the original award to the Northrop team. The GAO said Chicago-based Boeing, which protested the deal, might have won had the service had mistakes not been made in evaluating the bids.

Gates said his office, not the Air Force, will oversee the competition and pick a winner by the end of the year.

Young said he expects the process will be wrapped up after the US presidential elections, but before a new government is established.

The Pentagon rebid is limited to eight issues where government auditors found problems in the initial process, Gates said.

Young dismissed some of the points as technicalities, and said others require supplying more data or for the military to answer.

Air Force officials have said they choose the EADS/Northrop tanker in large part because its size will enable it to carry more fuel, cargo and passengers. Boeing protested, saying the original proposal did not call for a ‘jumbo-sized tanker.’

Young said he is confident because the A330 aircraft on which the Northrop Grumman KC-45 Tanker is based is ‘ready for the military modifications.’ The A330 has also been chosen by the air forces of Australia, United Kingdom, Saudi Arabia and United Arab Emirates.

The Pentagon is expected to issue a draft of the revised bid request to the companies by early August.

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